Well, thank you, Mr. Doleac, for the introduction. First of all, let me say, ladies and gentlemen, that I am extremely honored and privileged to be able to address you from this very high podium.

I will try to shift the focus a little bit from discussing statesmen and politicians by bringing in the public. Whatever else is happening in Russia, it is certainly in the process of democratizing itself, which also means that the people who lead it will have to pay increasingly more attention to what their publics think and say. And I think that this country as well as some other countries around the world have suffered a little bit from being too much concentrated on one figure. In most recent Russian history, whether it was -- whether the name of the figure was Gorbachev or Yeltsin, somehow the concentration was a bit too high for the soundness of policy.

I think that we should learn our own lesson from history not to commit the same mistake right now. I'm a little bit disturbed in various audiences both here and when I am back at home in Moscow listening to people who spend hours discussing Mr. Putin. My own of view of Mr. Putin is that he is very much a work in progress. It is not -- those who expect him to unveil his well hidden plan, the project for Russia, let's say on the morning of March 27, because no one thinks there will be a second ballot, may be disappointed. It will take some time for Mr. Putin to sort things out. And more importantly, Mr. Putin will not be the only actor in Russia. In a way, he will be the least relevant leader in the last ten years.

It took a Gorbachev to start the dismantling of communism, and he didn't know that, the Soviet Union. It took a Yeltsin to launch the country on the path of transition. But for Mr. Putin, in front of Mr. Putin, rather, there is a corridor. And the corridor was not made by Mr. Putin. He will only decide on his behavior of that corridor. Russia is moving under tremendous constraints. And it was not -- the options that were open to a Stalin are simply not open to whatever his name is who leads Russia today. But I will -- this is a short introduction. I hope it will not be counted against me as far as the schedule is concerned. No, no. I'm kidding.

There is another thing. I guess that times when statesmen could afford not to be politicians was over with the great figures of Baron Komura and Count Witte. They served their emperors. They served at the emperors' pleasure. They didn't have really to respond to the publics. Although as Professor Kimura said, the publics were very vocal on the return of Baron Komura to Japan and there were a few people rumbling in the Russian Army about how well they would have performed had the Czar and Witte not signed that awful piece. But basically they could afford not to take attention to what the publics were saying. It was right for Mr. Kruschev to make his offer of two islands to Japan because he could only worry about how many guns he had in the (inaudible) bureau or as it was called, the presidium of the communist party. He didn't have to think in terms of political opinion polls. The last leader in Russia to perform a similar feat was Mr. Gorbachev. But for his own policies, he was undermining that unique position. So to the extent he was being successful elsewhere, meaning taking Russia unwittingly toward the path of democracy and capitalism, he was becoming less effective as the sole actor in terms of -- also in terms of Russian domestic -- foreign relations. He did set eastern Europe free. He did turn the key on the reunification of Germany. But the time was running out on him. And he could never do what his Japanese counterparts wished him to do.

So my conclusion would be on this that the autocracy and territorialism is over. Negotiations and negotiated agreements have ceased to be the sovereign province of statesmen in the old sense, statesmen who could afford not to be politicians. Unfortunately, for modern politicians wishing to be statesmen, issues such as the ones we have been talking about this afternoon like issues of territorial integrity are easiest to be grasped by the publics, and most difficult to be dealt with by their leaders.

The current situation ten years after the dismantlement of the Soviet Union and Yugoslavia which endowed the world with another two dozen new members of the United Nations. There is a backlash against territorial changes, and you can see that across Europe and virtually across the world. But still dealing with territorial issues in some cases is the only way to reach the long desired political solution. But that is unlikely to be an easy task. I don't have to remind you of the fate of some leaders who tried a bit too hard, for their own sake, for their own health, I would say. Remember Armenian President was chased out of power, or the Israeli Prime Minister Yitzhak Rabin. Finding the right negotiating formula is essential, and finding right formula for the negotiating solution is essential, but it is not sufficient. The publics must get ready for a change.

Now, how do we move now to resolve the Russia-Japan situation? I think it's fair to say that we know a few well established truths; that there is no peace treaty and there can be no normal relations between the two countries without the solution -- ultimate solution of the territorial issue. I think it's also fair to note that both Russia and Japanese publics are strongly in one case against secession of territories and on the other hand of dropping the claim to the islands. The compromise formula suggested so far by both sides, whether it's the Hong Kong formula suggested by the Japanese side or the Russian formula which basically talks a lot about economic cooperation but leaves the most important issues as far as Japan is concerned pretty vague, these formulas have so far failed to break the ice. And the Krasnoyarsk declaration of a peace treaty by the year 2000 cannot be implemented. We all know that.

So where do we go from here? I think that there are several things that we need to take into account. Soviet conditions that must be fulfilled if we want to have a negotiated solution that will stick with the publics. There must be a personal engagement by the leaders. And I would strongly emphasize that this is not a one-sided thing. It's not just the need for strong engagement by Mr. Putin. Both countries must have sufficiently strong administrations to carry or to negotiate and carry out the deal. And for the governments to instruct the diplomats to move towards a solution, they must be nudged by their publics. The publics as we all know are made of very diverse groups pursuing very different agendas. And that means that in order to be successful, powerful coalitions must be built in both countries supporting negotiated settlement. We all know that there is no such pressure at this moment.

For Russia to give, it must first of all get -- win back, if you like, some self-respect and self-confidence. Russia has given up, given away, just left and neglected a lot of Panama Canals around the world in the past ten years or so.

The problem that the outside world has in dealing with Russia, the problem today is that it is an incredibly weak country. It is an incredibly weak government. That is as much of a problem as an assertive and over-confident Russia would have been, was in the case of Soviet Union. A weak Russia cannot be expected to step back. And a weak administration would not do what will turn out to be a suicidal move. They may be not very perfect in terms of their democratic credentials, but they are politicians which have to play by certain rules of the game. For Japan to move, its exporters and investors must either scramble to get access to the lucrative Russian market, which unfortunately we all know is not out there for the moment and for a very long moment, I think. All as politicians and strategists must have, to quote Russia, for fear of China's (inaudible) money or U.S. withdrawal, both of which appear very remote for the moment but not entirely unthinkable. The China factor is also present clearly in Russia's approach to the relations with Japan. Somewhere along the way, however, a combination of propitious factors may arise in both countries. But I would warn against being over-optimistic with Mr. Putin. I don't think, unfortunately, though it may be, that he will see this as a golden opportunity for him to move to meet the Japanese. Quite frankly, being a politician, he will ask the sacramental question, "What is in it for me?" We have one -- and the people watching him will say, "Hey, we already have one honorable German among our former leaders in Mr. Gorbachev who is an honorary citizen of Berlin. Do we need an honorable Japanese among our leaders?" I think this is a very hard question that Putin will have to think about.

As to his -- as to the Nixon-China analogy, the problem is that Mr. Putin will be primarily judged on his economic performance at home, not on his international relations, successes. And I think that Mr. Putin's pronouncements on the subject, and I disagree that we don't know who Mr. Putin is, I think as intelligent people, we know a lot to make an initial judgment. The other thing, of course, is that Mr. Putin is a work in progress, as I said. He will change. He doesn't know where he is leading. Well, he knows more or less, but he doesn't know some of the key details. So the Nixon-China analogy may be misleading because Mr. Putin has a very different country behind him in comparison to Mr. Nixon's America. I think that it would be right if the Japanese and the Russians approached the problem as a medium term issue. It is unlikely to be resolved anytime soon.

But if we do not map out a realistic strategy, realistic by comparison to the strategy mapped out in Krasnoyarsk which stunned both the people in Tokyo and the people in Moscow, we can be eventually successful.

I think that along the way, a combination of propitious factors may arise in both countries favoring the solution. Russia with luck will be a bit more cohesive under Putin, a bit more confident and would get a more or less effective leadership. Its transformation would make it marginally attractive to others including the Japanese and the Chinese and the Koreans. On the other hand, I don't think you can ever imagine Russia becoming again so strong and assertive as to be a threat for the region.

I think that Japan would increasingly see a need for an even more creative approach to Asia and new Asia. And at some point Russia may appear for the first time as a land of some very modest but some economic opportunity. In a word, a deal would become possible and desirable when both Russian and Japanese societies will be ready to embrace it. The actual details of such an arrangement will take a great deal of time and effort to work out, but politically and strategically they will be less important than the deal itself.

The time frame for such a scenario I would imagine would last between seven and ten years. I don't think that we can really hope to get it before that time. But in the meantime, we have to do our utmost to prepare the publics for this grand compromise, make Japan more familiar and better liked in Russia, and Russia less hostile in Japan, promote contacts among the elites. I don't think that we have done enough of that at both national and regional levels including in the Far East, and not just the islanders. One can buy off the islanders. Who cares. But the -- the provinces which lie across the sea from the islands, the maritime province, Sakhalin clearly because the islands are part of Sakhalin region. And what is important for Russia is to see whatever deal the Russians would be prepared to make on the Kurile Islands as part of their larger design for Siberia and the Far East.

I think the Russian elites are becoming increasingly aware of the growing marginalization of Russia in the world which is becoming really marginal in both Europe and Asia at the same time.

Mr. Putin in his intimate article will not only say the obvious thing and oft quoted thing that Russia was trailing ten times in terms of GDP behind the United States, he added that we are also trailing back five times behind China. That is a very, very powerful statement coming from a Russian leader.

Unless the Russians will have a creative policy on Siberia and the Far East, chances are that -- well, whoever said that empires are forever. This is a very serious thing.

In order to stay Russian, those areas have to be opened up. In order for them to be opened up and not to be swamped by just won neighboring country, you have to have a stake in different countries. You have to involve the Japanese, obviously, but also the Koreans and the Americans and maybe some others. In order for the Far East and Siberia to stay Russian, they must be internationalized in the sense of economic and people-to-people relations, etc., etc.

I think I have used up nearly all my time, and I will conclude that this project which I would call Russia in Asia project is of interest and importance not just for those sitting like myself in Moscow. It is clearly of very big importance for China, for Japan, I hope, and also for the United States.

Theodore Roosevelt was instrumental in ending the first Russian-Japanese war. Franklin Roosevelt did his best to involve Russia and the Soviet Union in the second war. And it is incumbent on the United States to successfully -- to facilitate the difficult but utterly important Russian-Japanese (inaudible). Russia and Japan lost the 20th century in wars and confrontation. It is incumbent upon all of us to see to it that they don't lose the century that's just beginning. Thank you.